1 This publication presents results from a survey of private medical practices for the reference year 2001-02. This is the second time the Australian Bureau of Statistics (ABS) has conducted this survey. Previous statistics were released for 1994-95.

SCOPE

2 The scope of the survey was all private medical businesses primarily offering general medical services and specialist medical services. In terms of the Australian and New Zealand Standard Industrial Classification (ANZSIC), these businesses would be classified to class 8621- GENERAL PRACTICE MEDICAL SERVICES and 8622 - SPECIALIST MEDICAL SERVICES. Administrative service businesses providing dedicated services to these businesses were also included.

3 The scope also included pathology laboratory businesses who provided a pathology service in which human tissue, human fluids or human body products are subjected to analysis for the purposes of prevention, diagnosis or treatment of disease in human beings and included any premises from which a service was conducted (this definition is based on the definition of a pathology service as specified in the Pathology Services Accreditation Act 1984: Act no. 10083/1984).

4 Government departments, hospitals, nursing homes, community health centres, universities and businesses predominantly providing veterinary pathology laboratory services were excluded from the scope of this survey.

COVERAGE

5 In order to obtain a population for the Medical Practices Survey, a survey of medical practitioners was conducted during 2002 using a sample of medical practitioners selected from the Health Insurance Commission's Medicare Provider File (HIMPF). Results of this survey were published in Private Medical Practitioners, 2002 (cat. no. 8689.0).

6 The population used for businesses undertaking pathology services was a listing supplied from the National Association of Testing Authorities (NATA). Businesses on this list were accredited with NATA, have received a NATA category of GX, GY, S or U (Extract from NPAAC Guideline Requirements for Supervision of Pathology Laboratories, 1999)and would have received more than 50% of their income from fee for service medical income. Government departments, hospitals, universities, and businesses predominantly providing veterinary pathology laboratory services were excluded from this survey.

STATISTICAL UNIT

7 The statistical unit used to represent private general and specialist medical businesses and their administrative service businesses, and for which statistics are reported, was the medical practice.

8 Medical practices may be structured as one single entity or more than one entity. Medical practices with more than one entity may be supported by an administrative service business that manages the finances and secretarial activities of the medical business.

9 For the purposes of this survey, a medical practice was defined as follows:

single medical businesses not supported by an administrative service business. In these cases, each medical business was treated as a single medical practice

single medical businesses with a single administrative service business. In these cases, the medical business and administrative unit were combined to form a single medical practicesingle administrative service business with multiple medical businesses. In these cases, the multiple medical businesses that were supported by the same administrative services business were combined to form a medical practice.

10 Since 1994-95, large administrative service businesses have established themselves in Australia, servicing multiple medical businesses. These businesses were generally not owned by medical practitioners. In order to recognise this phenomenon, a corporate medical practice was created for the purposes of this survey. A corporate medical practice was defined as:

a practice in which medical businesses had been contracted to a corporate administrative entity for a fixed period to provide mainly general practice services. The corporate administrative entity was generally owned by persons who were not medical practitioners. The corporate practice comprised at least 10 general medical practice businesses, which used the facilities and infrastructure provided by the corporate entity. The general medical practice businesses were usually centralised at the same location so as to provide sufficient volume to attract other medical and ancillary services.

11 Further information on these units can be found in the Glossary.

CONCEPTS

12 The survey only collected financial information recorded in accounts of operating businesses. Any income paid directly to individual practitioners, and/or any expenses paid privately by individual practitioners did not appear in the estimates of this survey.

13 Income and expense estimates such as, visiting medical officer income, income from the government rural incentives program, professional indemnity insurance for individual medical practitioners, motor vehicle expenses and continuing education expenses would not represent a total value for these items in the Private Medical Practices publication, as income received and/or expenses paid by individual practitioners for these items may not have been recorded in the business accounts. Therefore, use of these estimates should be made with caution.

14 In order to derive practice income and practice expenditure from the reported business' income and expenditure, it was necessary to net out any payments between businesses within the one practice. For example, if a medical business received income of $100,000 and paid expenses of $50,000 to its administrative support business, then the $50,000 expenses of the medical business and the corresponding $50,000 income of the administrative service business were netted out from the practice unit. Netting out the transfers resulted in the practice income being $100,000, and not inflated to $150,000. The total expenses for the practice unit were the summation of the expenses of the medical business (less $50,000) and the administrative service business.

CLASSIFICATIONS

15 The Rural, Remote and Metropolitan Areas Classification (RRMAC) was used to classify the geographical location of medical practitioners according to their main business address. The RRMAC was originally developed in 1994 by the former departments of Primary Industry & Energy and Human Services & Health. An updated version of the RRMAC (obtained from the Department of Health and Aged Care) was based on 1996 postcodes and was used to produce estimates for this publication. For the purposes of this publication the RRMAC categories 1-3, 4-5 and 6-7 were collapsed to form 'Metropolitan', 'Rural' and 'Remote' categories respectively.

16 The classification of medical specialties used in this publication was based on the Medical Peer Group Specialist Classification used by the Health Insurance Commission.

COMPARISONS WITH OTHER ABS STATISTICS

17 Annual data for the general practice medical services industry, the specialist medical services industry and the pathology services industry are published in Australian Industry (cat. no. 8155.0). There are important differences between the statistics published in the Australian Industry and Private Medical Practicespublications and users should use caution when making comparisons between the two sets of estimates. The estimates in the Australian Industry publication provide a consistent annual measure of economic activity by industry (as defined by the ANZSIC), which allows the analysis of year on year change in key data items in the medical services industries.

18 The Australian Industry publication presents summary statistics for detailed ANZSIC industry classes. The aims of the publication are to show the relative importance of each industry class to the Australian economy, and to allow patterns of change or growth to be analysed across detailed segments of the Australian economy. The industry estimates presented in Australian Industry are used in the compilation of the National Accounts, and in the derivation of economy-wide indicators such as gross domestic product (GDP).

19 The Private Medical Practicespublication complements the annual series of key data items for the industry with a detailed examination of the structure of medical practices and pathology laboratory businesses for the reference year of the survey. Private Medical Practices had a focus on the medical practice, rather than the business entity that is used to compile ABS industry statistics. The practice is used as the statistical unit in order to provide a more complete description of the structure of businesses involved in private medical services and the economic activity generated by medical practices. This is done by including administrative service units in the survey although they might be coded to ANZSIC classes other than GENERAL PRACTICE MEDICAL SERVICES or SPECIALIST MEDICAL SERVICES (ANZSIC classes 8621 and 8622).

HISTORICAL COMPARISONS

20 While comparisons are made between 2001-02 survey results and the 1994-95 Private Medical Practices survey, the reader should bear in mind that the survey was not designed to support accurate estimates of change, and should exercise caution when comparing 2001-02 results to earlier surveys. The effect of sampling variability on historical comparisons is discussed in paragraph 32.

21 The frame source and therefore coverage for pathology services had changed since 1994-95, so caution should be used when making comparisons between surveys for these estimates.

22 The 1994–95 survey included businesses selected from the ABS Business Register, classified to the ANZSIC class 8631 - PATHOLOGY SERVICES, which includes pathology laboratory operation. During processing of the 1994-95 survey it became clear that there was a high level of miscoding of units between this class and another related class,8622 - SPECIALIST MEDICAL SERVICES. Class 8622 included a number of specialists,including pathologists running their own business. As a result of this miscoding, only 17 pathology laboratory businesses were subsequently detected and reported in the 1994–95 estimates.

23 In 2001-02, the NATA list (refer paragraph 6 for more information) was used to improve survey coverage of pathology laboratory businesses. As a result, 50 pathology laboratory businesses were identified as operating during 2001–02. This increase in the number of businesses would have been caused primarily by the improved coverage of pathology laboratory businesses in the survey, and would not reflect true growth.

24 The definition of a practice had slightly altered since 1994-95. During 1994-95 it was possible to have medical practices with more than one administrative business. This was no longer the case in 2001-02. Although the definition was altered, the impact would be minor as there were very few multiple administrative services businesses in 1994-95.

RELIABILITY OF DATA

25 When interpreting the results of a survey it is important to take into account factors that may affect the reliability of estimates. Such factors can be classified as either sampling or non-sampling error.

26 The estimates in this publication are based on information obtained from a sample of medical businesses and administrative services units in the target population. Consequently, the estimates in this publication are subject to sampling variability, that is, they may differ from the figures that would have been obtained if all businesses within medical practices had been included in the survey. One measure of the likely difference is given by the standard error (SE), which indicates the extent to which an estimate might have varied by chance because only a sample of businesses were included.

27 There are about two chances in three that a sample estimate will differ by less than one SE from the figure that would have been obtained if all practices in Australia were surveyed, and approximately 19 chances in 20 that the difference will be less than two SEs.

28 Sampling variability can also be measured by the relative standard error (RSE), which is obtained by expressing the SE as a percentage of the estimate to which it refers. The RSE is a useful measure in that it provides an immediate indication of the percentage errors likely to have occurred due to the effects of random sampling, and this avoids the need to refer also to the size of the estimate.

29 The following table contains estimates of relative standard errors for a selection of statistics presented in this publication.

RELATIVE STANDARD ERRORS FOR TABLE 1.1 SUMMARY OF OPERATIONS

General practices

Specialist practices

Pathology laboratory businesses

%

%

%

Medical practices at end June

3

2

1

Medical practice locations at end June

4

3

..

Medical practices using computers for

Patient records

3

3

n.a.

Prescription packages

3

12

n.a.

Financial management or accounting purposes

2

2

n.a.

Research, teaching or preparation of articles

5

3

n.a.

Any purpose

1

1

n.a.

Employment at end June

Permanent full-time

3

3

6

Permanent part-time

3

4

8

Casuals

7

7

7

Total

3

3

6

Income

Fee for service medical income

3

4

5

Other

6

8

8

Total

3

4

5

Expenses

Labour costs

3

4

5

Rent, leasing and hiring expenses

5

5

6

Other

6

7

5

Total

4

4

5

Operating profit before tax

4

5

6

Operating profit margin

4

5

6

Return per FTE practitioner

2

3

..

Industry value added

2

3

5

.. not applicable

n.a. not available

Copyright ã Australian Bureau of Statistics, 2003

30 As an example of the above, an estimate of total employment in GP practices is 56,911 and the relative standard error is 3% giving a standard error of 1,707 people. Therefore, there would be two chances in three that, if all units had been included in the survey a figure in the range of 55,204 and 58,618 people would have been obtained, and 19 chances in 20 (that is, a confidence interval of 95%) that the figure would have been within the range of 53,497 and 60,325 people.

31 The sampling variability for estimates at the state/territory level was higher than for Australian level aggregates. Within states/territories, the sampling variability, and therefore the RSEs of estimates for smaller states/territories are higher than for the largest states. Survey estimates for the smaller states and territories should therefore be viewed with more caution than those for other states. RSEs for New South Wales, Victoria and Queensland are typically 1 to 2 times higher than the corresponding national estimate RSEs, and RSEs for the remaining states and territories are typically 3 to 5 times higher than the corresponding national estimate RSEs.

32 The sampling variability for estimates of movement or change that are obtained by comparing 2001-02 survey results with previous results are also subject to high levels of sampling variability. The SE of the estimate of change is approximately 1.4 times the SE of the 2001-02 estimate. For example, the survey estimated that total employment in GP practices increased from 54,657 in 1994-95 to 56,911 in 2001-02, an increase of 2,254. The SE of the 2001-02 estimate of employment in GP practices is 1,707. The SE of the estimate of change is estimated to be 1.4 times 1,707, or 2,389.8. This can also be expressed as a RSE of 106% of the estimate of change in employment in GP practices. The magnitude of the SE relative to the size of the observed change in the estimate means that this change can be fully explained by the level of sampling error in the survey, and may not reflect a true rise in employment.

33 Errors other than those due to sampling may occur in any type of collection and are referred to as non-sampling error. For this survey, non-sampling error may result from such things as deficiencies in the register of practitioners from which the original sample was drawn, non-response, imperfections in reporting and/or errors made in compiling results. The extent to which non-sampling error affects the results of the survey is not precisely quantifiable, but its impacts can be broadly identified. Every effort was made to minimise non-sampling error by careful design and testing of the questionnaire, efficient operating procedures and systems and the use of appropriate methodology. Survey estimates subject to a high level of non-sampling error have been suppressed or provided with relevant cautions.

34 Estimates that have an estimated relative standard error between 10% and 25% are annotated with the symbol '^' . These estimates should be used with caution as they are subject to sampling variability too high for some purposes. Estimates with an RSE between 25% and 50% are annotated with the symbol '*', indicating that the estimate should be used with caution as it is subject to sampling variability too high for most practical purposes. Estimates with an RSE greater than 50% are annotated with the symbol '**' indicating that the sampling variability causes the estimates to be considered too unreliable for general use.

35 Where figures have been rounded, discrepancies may occur between the sum of the components and the total. Similar discrepancies may occur between a proportion or ratio, and the ratio of the separate components.

REFERENCE PERIOD

36 Data contained in the tables of this publication relate to all private medical practices that operated in Australia during the year ended 30 June 2002. Financial estimates included the activity of any medical practices that commenced or ceased during the year, however, counts of locations and employment did not include these practices if they were not operative at 30 June 2002.

RELATED PUBLICATIONS

37 Statistics for the related survey of medical practitioners are available in Private Medical Practitioners, Australia, 2002 (cat. no. 8689.0).

ACKNOWLEDGMENT

38 ABS publications draw extensively on information provided freely by individuals, businesses, governments and other organisations. Their continued cooperation is very much appreciated; without it, the wide range of statistics published by the ABS would not be available. Information received by the ABS is treated in strict confidence as required by the Census and Statistics Act 1905.

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